New labour hire laws – how to avoid large fines

If you use a labour hire business to provide you with the experienced workers that you need, you have to pay attention to the Labour Hire Licensing Act which has already passed in Queensland and South Australia and which is likely to be in place throughout the country in the near future. The aim of the Act is to clean up the labour hire industry.

As a result of the new laws, labour hire companies are required to be licensed. This change has been welcomed by experienced and reputable labour hire providers such as Brix Projects who have built their business on values like “Quality, professionalism, safety, honesty, integrity and responsiveness.” They want less reliable providers to be identified. It’s not just labour hire providers that are affected either; if you use labour hire services, you need to pay attention to the Act.

What is the Labour Hire Licensing Act?

The Labour Hire Licensing Act 2017 was passed by the Australian parliament in 2017. Its rules have been in place in Queensland for several months and since September 2018 in South Australia. The Act provides for the licensing of labour hire providers and only providers that meet all of their legal obligations, and ensure that they maintain high standards, can obtain a license.

There are several obligations that companies must fulfil such as reporting their activities every six months and showing their license to official inspectors on request. Serious offences such as operating without a license, and making avoidance arrangements to circumvent license requirements, can be punished with up to three years in prison or a substantial fine.

How does the law affect you?

You can see the seriousness of the new labour hire laws for labour hire providers; but you may be wondering what all this has to do with you and your business. It’s simple, under the new laws you are obliged to only use licensed labour hire companies. If you use a company that is not licensed, or make an avoidance agreement, you face the same stiff penalties as the company. There are several penalties which can be applied including the imposition of a fine of up to $391,650 for a corporation or $134,988 for an individual, or a jail term.

Allegations will be investigated

Any allegations of non-compliance with the laws will be investigated and a thorough audit will be carried out. Paperwork can be inspected, premises visited and workers interviewed. If there is found to be any irregularity with a labour hire provider, and you are using their services, you and your business will face legal difficulties.

It’s your responsibility to ensure that the labour hire provider you use is licensed, and fully compliant with the new laws. You should never just take this for granted and assume that everything is fine. Doing so could mean that you are putting you and your company at risk; something you cannot afford to happen.